The history behind technology refreshes
Until recently, technology developments were so rapid and large in scope that if your PC was more than two years old, you were significantly limited in what you could do with it. Therefore, most businesses adopted a two-year refresh cycle.
The two-year cycle was an outgrowth of what's been referred to for decades as Moore's Law. Gordon Moore, founder of Intel®, made the observation in 1965 that chip complexity would double approximately every 24 months. To a large extent, his prediction has been accurate.
Today, many companies have adopted a three-year tech refresh cycle to take advantage of PC innovation and keep pace with competitors. In general, three- to five-year PC refresh cycles seem to be the norm.
PC refreshes save money and time
So, what is the optimal technology refresh and upgrade cycle? Is it cost and time efficient to keep your old PCs? Ultimately, you must make tech refresh decisions based on organizational enhancements attributable to two criteria: reductions in total cost of ownership (TCO) and increases in return on investment (ROI).
Studying TCO and ROI allows you to analyze the lower price and maintenance gleaned from up-to-date technology along with productivity advancements that accompany faster and newer PCs.
The TCO perspective
IT experts are urging companies to adopt a more aggressive policy on tech refresh. Once a PC is more than three years old, it often costs more to continue maintaining it than it would to purchase new equipment.
Industry experts peg the average cost of a new desktop at $750, which would average $250 per year for the first three years. If you spread the cost over four years, your cost drops to $190 per year — a savings of only $60 per year. You have to ask yourself if it's worth all the trouble of keeping that PC for an extra year. Overwhelmingly, IT experts say it isn't.
Usually, you will incur very little expense the first two or three years of PC ownership. Routine maintenance is minimal and warranties are still in place during this period in the event of a serious malfunction.
But by the time your PCs enter their fourth year, they become more expensive to maintain. Typically, at the four-year mark, you no longer have automatic support of operating system software. Extended warranty costs increase. Calls to the help desk tend to increase. The amount of required routine maintenance also starts to increase. And you have to begin buying and storing spare and replacement parts in anticipation of a failure.
The productivity and security perspective
Your business will realize productivity gains through the speed and efficiency that accompany the enhanced operating systems, faster processors and larger storage capabilities of newer PCs.
If your equipment is old, you're compromising the security of your business. Dated PC security protocols create security gaps that expose your network and create problems. When you move to new equipment, you get stronger security. New PCs allow you to run continuous virus scanning and file encryption programs without disruption to users.
The cost of downtime due to a virus outbreak can be significant. You can calculate the cost of virus-related downtime by counting the number of attacks per year, the number of PCs affected, total downtime for each computer and the cost per employee of each hour of downtime.
In the case of replacement notebook PCs, giving your employees use of mobile and wireless technologies also improves your bottom line by enabling employees to be flexible in where and when they can work. Wireless access points are popping up everywhere today, which means that an employee can stay in touch and on the job outside of the office.
Notebooks have also seen significant increases in the area of data protection in recent years. Virtual private network (VPN) software allows secure connections to your network from outside the office. And technologies such as biometric fingerprint sensors and encryption keys make access to the notebook and its contents more difficult for unauthorized users.
PC refresh tips: migrate, dispose, manage
If your equipment has reached the end of its useful life, you will need to migrate locally stored data to your new PC. Software licenses and maintenance rights should also be recaptured on the new equipment.
Remember that any time old equipment is traded in, recycled or donated, you must erase all business-related files stored on the product so that your data isn't compromised. CDW offers several software products that can help you erase data and help you protect your confidential business records.
Finally, remember to record software-licensing information so you can track and manage your assets in the future.
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Why a three-year PC refresh cycle?
• Lower overall costs are the single biggest reason to make the decision to refresh earlier rather than later.
• The average selling price of PCs is down 40 percent in the last three years, meaning you'll see bigger savings right off the bat with a new purchase.
• Newer PCs have fewer software applications to maintain, which leads to lower costs.
• New PCs feature productivity improvements for end users.
• New PCs address current and future security needs better.
• After three years, the operating costs of a PC shift from hardware and software expenditures to indirect costs such as lost productivity and downtime.
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CDW Leasing
CDW offers four different leasing terms with three end-of-lease options. CDW leasing specialists are available to assist with quotes, account information or any questions that you have. To learn more, contact your CDW account manager today. |
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